By Ben Nicholson
November 10 – A report has been published in the US detailing a cost-benefit analysis of Washington-based MLS club D.C. United’s proposed soccer specific stadium development. The 406-page report suggests that the benefits will outweigh the costs.
Under the plan D.C. United would sell their current land to a real estate developer and lease it back for three years before the demolition of the stadium. In its place would be erected a mixed-use property.
The local Mayor’s stated purpose of the deal is to spur economic development, creating job and economic opportunities for local people – as presented, the numbers make a compelling case.
The report looks 32 years into the future to estimate that over the period, $2.6 billion will be generated through new direct, indirect and induced spending in the ‘District’. The net spending is thought to support 1,683 new full-time equivalent jobs.
The Stadium Act itself is estimated to create a $38 million profit, over the same period, which becomes $109.4 million when including the proceeds from land exchanges.
Furthermore, “The Stadium Act would authorize sales and real estate tax breaks worth a new present value (“NVP”) of approximately $50 million”, which will come in handy since the stadium is considered to be the most expensive MLS stadium to date, reaching an estimated $286.7 million total.
The cost of the stadium will be split roughly down the middle between D.C. United and the District. The District will contribute $131.1 million to the project, an estimated 46% of the total cost.
As bright as the prospects seem, multiple risks are mentioned in report. Nine are specifically mentioned in the executive summary, in an elusive alphabetized format opposed to the numerically formatted key findings above. However, the risks appear of ordinary tenor given the nature of the project.
Wariness of land exchange agreements, overrunning costs, and unpredicted environmental effects do not dampen the positives that the report reflects. The capital available and the future capital it could generate present an optimistic look for the future of soccer in D.C. in combination with economic benefits to the local community.
Meanwhile, tomorrow, the team itself is looking to overturn a 2-0 deficit in its Eastern Conference Semi-Final second leg.
The full report can be viewed at: http://lims.dccouncil.us/_layouts/15/uploader/Download.aspx?legislationid=31817&filename=B20-0805-FINAL-Report—Cost-Benefit-Analysis50.pdf
Contact the writer of this story at moc.l1734833703labto1734833703ofdlr1734833703owedi1734833703sni@n1734833703osloh1734833703cin.n1734833703eb1734833703